Cablecos Pass Buck To, Take Bucks From, Consumers in 2011

We open every episode of our web series Cord Cutters by reminding viewers that dropping their cable subscriptions is a great way to save money, and in 2011 that’s going to become even more true.

AT&T Uverse announced today that it’s increasing its prices for 2011, effective Feb. 1 — and rates may increase from 2.4 percent to 10.2 percent, according to Multichannel News. And it’s not the only company planning to up rates — the Los Angeles Times says that Time Warner will be tacking on an additional five percent to its customer bills. Time Warner customers in New York saw increases of over 6 percent, depending on their service plan: Digital bundle rates are being raised from $71.00 per month to $75.95, and “All the Best” bundles of digital cable, phone, and broadband are being raised from $144.95 per month to $153.99. Even the monthly fee for Time Warner Cable remotes are being raised: $0.50, as compared to the previous $0.30 per month.

As the L.A. Times points out, a five percent hike can’t really be considered a response to inflation, which is projected to only be about one percent in 2011. What’s really going on is that subscriptions are dropping, and retrans fees for content are rising — and at least in the latter case, cable companies are promising to pass those increases onto the consumer.

In the end, our customers will pay more than they should for Fox programming, but less than they would have if we had accepted the unprecedented rates News Corp. was demanding when they pulled their channels off Cablevision.

And the fledgling Hulu Plus dropped its monthly cost from $9.99 to $7.99. Both of these services are adjusting their pricing options for consumers, in short, while cable companies hike up rates believing that subscribers won’t mind an extra $3 a month, and hoping that subscribers don’t figure out how much of what they’re paying over a hundred dollars for every month can be gotten for cheaper online.